Bestinvest says
The BlackRock New Energy fund is run by an experienced team which is part of the extensive Blackrock commodity team. The fund experienced a difficult period during 2008, when renewable energy stocks performed poorly, and has failed to recover from this. Similarly prior to 2008 the fund traded on a premium whereas now it trades at a large discount. The management team are increasing their exposure to Asia and away from renewable energy towards mitigation. Over the long term the theme is very strong and we would expect performance to improve.
This fund will invest globally in companies at the forefront of Alternative Energy, Energy storage and efficiency. The fund has no directly comparable benchmark so the mandate is simply to produce positive returns.
The fund will invest in several companies that are beneficial to the climate although this is not designed to be an ethically driven trust.
As the sector evolved so the trust has evolved with it. Initially the fund was focused on small high growth companies but now the fund holds companies across the market capitalisation range.
Similarly, as the importance of Asia and specifically China has risen so the fund has positioned itself towards these markets.
Company valuation techniques consistent with those used by other BlackRock commodity funds. Firstly the macro environment is mapped over the short and medium term with the aim of identifying specific sectors that will benefit form it. From this individual companies' revenues are forecast and then discounted at the appropriate cost of capital. However, due to the very specialist nature of the sector the process is more subjective than for other funds.